Legal Q & A: Age discrimination

A Age discrimination has been a hot topic for some time. The
Government is committed to introducing legislation outlawing age discrimination
under the European Employment Framework Directive. This is also set against the
background of the Government’s need to deal with the ageing workforce and the
‘pensions timebomb’.

Q What is age discrimination and whom does it affect?

A The proposals, due to commence on 1 October 2006, will outlaw
direct and indirect age discrimination. Direct discrimination occurs when a
decision is made on the basis of a person’s actual or perceived age. Indirect
discrimination occurs when a policy or practice applies to everyone, but
disadvantages certain groups (that is, younger or older people) unless there
are justifiable reasons. The legislation will apply to employers, providers of
vocational training and trade unions, professional associations and employers’
organisations.

Q What are the main proposals?

A The key proposals are:

– Compulsory retirement ages will be outlawed unless they are justified. The
Government is consulting on whether employers should be able to justify
mandatory retirement ages in exceptional cases, and whether there should be a
default retirement age of 70, after which no justification would be required.
There will be no upper age limit on the right to claim unfair dismissal

– Decisions on recruitment, selection and promotion based on age, including
applying an age limit on recruitment, will be unlawful unless they can be
justified

– Employers can continue to provide pay and non-pay benefits based on length
of service or experience, if it is justifiable

In the calculation of the basic award for unfair dismissal and the statutory
redundancy payment, age would cease to be a factor, although 20 years’ service
would continue to be the maximum that could be taken into account. The
Government is currently consulting on when the right to a redundancy payment
should cease.

Q On what basis will using age as a factor be justified?

A The Government is proposing specific aims for the legislation which
would be used in determining whether discrimination is justified. Those aims
are:

– Health, welfare and safety – for example, the protection of younger staff

– Facilitation of employment planning – for example, where the business has
a number of people approaching retirement age at the same time

– The particular training requirement of the post in question. As an
example, the Government cites air traffic controllers, who need high levels of
health, fitness and concentration, and need to undergo extensive training in
their posts

– The need for a reasonable period of employment before retirement

Q What will be the impact of this legislation?

A It will have a profound impact on every decision made by employers.
They will need to consider whether any decision related to employment adversely
affects one age group or another. Employers and their legal advisers will need
to second guess what an employment tribunal might consider to be justifiable.

Q What will be the impact on recruitment practices?

A Although recruiting within particular age bands will not be
outlawed, employers will need to think carefully about whether it is
justifiable. For example, on graduate recruitment programmes, it is unlikely to
be justifiable to limit them to people below a certain age when there may be
significant numbers of mature graduates.

Employment tribunals will not be too impressed with employers who limit
recruitment to those under 25 years of age because they have a young team, for
instance, or to those over 35, say, because they want mature employees. Each
application would have to be justified on its own merits.